Wednesday was a great day on Wall Street, with the Dow Jones Industrial Average pushing ahead to gains of around 300 points and other major benchmarks following suit with similar-sized rises. Fears about potential European financial problems vanished as quickly as they had appeared on Tuesday, and bounces in crude oil prices and interest rates seemed to confirm that the previous mind-set favoring continued growth for the overall economy was back in place. Yet some companies still had bad news that sent their shares lower. Michael Kors Holdings (NYSE:CPRI), Chico's FAS (NYSE:CHS), and Daktronics (NASDAQ:DAKT) were among the worst performers on the day. Here's why they did so poorly.
Kors hits a speed bump
Shares of Michael Kors Holdings fell over 11% after the upscale retailer reported its fiscal fourth-quarter financial results. The company saw total revenue rise 11% from year-earlier levels, lifted largely by the acquisition of Jimmy Choo last year. Yet comparable sales for the retail segment were up just 2.3%, and they actually fell when you take out the favorable impact of currency fluctuations. Weakness in the wholesale and licensing segments also weighed on performance, and Kors said that comps for the full 2019 fiscal year are likely to be flat. That disappointed investors, and without a stronger recovery, Kors could remain under pressure for some time.
Chico's takes an earnings hit
Chico's FAS stock dropped 18% in the wake of the company's poor performance in its fiscal first quarter. The women's apparel retail specialist saw net income slip from year-ago levels, with CEO Shelley Broader saying that "first quarter customer traffic was challenging" even as the company did its best to target promotions to maximum effect. Chico's did say that initiatives to work with a variety of e-commerce partners are showing signs of initial promise, and it believes it will rely increasingly on these new channels in the long run. For now, though, investors aren't happy with the pace at which Chico's is embracing its future.
The lights go out on Daktronics
Finally, shares of Daktronics plunged 19%. The maker of scoreboards and displays for large public spaces saw sales and order flows fall in its fiscal fourth quarter, sending the company to a net loss and reversing a year-ago profit. Daktronics blamed the decreases in order volumes on normal variability in the needs of its customer base, and higher warranty charges also weighed on margin. CEO Reece Kurtenbach was optimistic about demand for LED video displays going forward, but if the key live events and commercial business doesn't show clearer signs of bouncing back from weaker sales, it'll be difficult for Daktronics to recover quickly.